M/S. Kerala Electricals & Allied Engineering Co.LTD. vs. The Deputy Commissioner

Facts

The appellant, M/s. KeralaS Electricals & Allied Engineering Co. Ltd., filed a Writ Petition challenging an assessment order (Ext.P6) passed by the Deputy Commissioner, Special Circle, State Goods & Services Tax Department. This order denied the appellant's claim for input tax credit amounting to Rs. 40,18,744/-. The learned Single Judge of the High Court found that the appellant's contentions challenged the assessment order on merits and that there was no jurisdictional error in its passing. Consequently, the Single Judge directed the appellant to pursue their alternate remedy of filing a statutory appeal under Section 107 of the CGST Act against the assessment order.

Held

The Court held that the appellant's contentions regarding the denial of input tax credit amounted to a challenge on the merits of the assessment order. The Court found no jurisdictional error in the passing of the impugned assessment order. Therefore, the learned Single Judge was correct in concluding that the appropriate forum for adjudicating the appellant's grievances was the First Appellate Authority under the statute. The Court saw no reason to interfere with the Single Judge's finding. The ratio decidendi is that writ jurisdiction is not the appropriate forum to decide disputes on the merits of tax assessments when a statutory remedy of appeal is available and there is no jurisdictional defect.

Key Issues

1. Whether the High Court, in its writ jurisdiction, should entertain a challenge to an assessment order on merits when there is no jurisdictional error, and the petitioner is relegated to the statutory appellate remedy? Petitioner's Argument: The learned counsel for the appellant contended that the assessing authority failed to appreciate the true scope of the legal provisions allowing the appellant to avail input tax credit. Revenue's Argument: The respondents did not record any specific arguments in the judgment, but the Single Judge's finding, upheld by the Division Bench, implies that the revenue's position was that the matter should be adjudicated by the statutory appellate authority.